What the Fed will tell markets this week

The Federal Reserve is set to release the minutes from its January FOMC meeting on Wednesday, and market participants are sure to closely sift through them for any clues about the future of quantitative easing.

"The minutes are going to be important, and there's always some morsel that people tend to gravitate toward," said Deutsche Bank's chief US economist, Joseph Lavorgna. "My guess is that in these minutes, it will relate to the outlook."

For any group that relies on economic data to determine its next move, this is a difficult time. Two straight employment reports have shown markedly weak gains in nonfarm payrolls (113,000 in January and a marginally adjusted 75,000 in December) but the extent to which bad weather adversely impacted those numbers is being rigorously debated.

New Fed Chair Janet Yellen, for one, told the House Committee on Financial Services on Tuesday that she was "surprised by the weak jobs reports in December and January, but we have to be careful not to jump to conclusions when interpreting what those reports mean—there were weather factors—we've had unseasonably cold temperatures that may be affecting economic activity in the jobs market and elsewhere. The Committee will meet in March. We will have a broad range of data on the economy to look at, including another jobs report."

However, LaVorgna points out that the February employment report could also be marred by weather conditions, given that last week's massive storm came on a survey week for the report.

Ironically, the storm even caused the Senate Banking Committee to postpone the second day of Yellen's congressional testimony, which had been planned for Thursday.

The Fed's minutes could consequently shed some light on exactly how much weakness the FOMC needs to see before it deviates from its course of tapering quantitative easing by $10 billion per month.

"The minutes will probably round out some of the things Chair Yellen said" in her testimony, LaVorgna told CNBC.com. "She said the Fed won't deviate unless there is a material markdown of outlook. That tells me that weather considerations aside, the Fed probably won't deviate from their plan in March, and that's what I'm guessing will be the message in the minutes."

"I think we're all going to be focused on the language of the minutes yet again," said Jeff Kilburg of KKM Financial. "The Fed's been driving the market for a long time, and Yellen still has the wheel."

The minutes, which are slated for release at 2 p.m. EST on Wednesday, will shed light on the decision-making and debate that marked former Fed Chairman Ben Bernanke's last meeting, which was held on Jan. 28 and 29.

As for the Fed's next move, that will be announced on March 19, after the next FOMC meeting.